Some real estate agents estimate that the value of a house could increase about 4% each year

Question

a. Write a function to model the growth in value for a house valued at $100,000.                                       B. Graph the function 

Answer 1

This is the answer for part a:

 

Let f(t) equal the future vale of the house after t years where the house increases in value 4% each year.

 

f(t)=100000(1.04)^t

 

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Answer 2

Hi Michael,

 

If the value of the home increases by 4% each year, we could say that the new value after one year would be 1.04 times last year's value.

 

    V_new = V_old*1.04

 

To find the value after two years, we would multiply by 1.04 twice. After three years, multiply three times, etc.

 

So, the value "V", as a function of time "t" would be:

 

    V(t) = $100,000*(1.04)^t

 

For each year that passes, the exponent on the 1.04 goes up by one, meaning it gets multiplied again.

 

I hope this helps!

 

Andy